Contractor nmcn is heading into administration following a board decision that it cannot continue trading as a going concern.

nmcn plc had entered into conditional agreements to recapitalise the business by way of a £24m fundraising with Svella and other investors, together with a renegotiation of its facilities with Lloyds Bank. A further £5m was also to be raised through an open offer to existing shareholders.  

But an inability to finalise its annual report for 2020 meant they could not be included within the prospectus and circular associated with the fundraising.

This week, it has been announced that Helen Dale, Nigel Morrison and Jonathan Roden of Grant Thornton UK LLP are set to be appointed as administrators. The remaining companies in the group are currently unaffected.

In a statement, nmcn said completing the preparation of the group’s accounts had revealed further underlying contractual issues with expected losses rising to £43m.

“It has now become apparent that the company will be unable to approve the audited financial statements in a timely manner to allow the proposed transaction to complete within the required timeframe. This in turn has led to significant liquidity issues for the group and particularly the company (nmcn plc), which unfortunately is now considered to no longer be able to continue trading as a going concern.

“Indicative offers have been received from certain parties for the acquisition of certain of the trading operations and/or subsidiaries of the company on a going concern basis, and discussions are ongoing with further parties which may lead to indicative offers on a similar basis.

Any acquisitions will be conducted out of administration, nmcn said, to “safeguard the continuity of operations and employment, and consequently the consideration receivable by the company is unlikely to result in any value for equity shareholders”.

The statement added: “The board of nmcn wishes to thank all of its shareholders, customers and suppliers for their support over the years and particularly Svella and those who had intended to participate in the equity subscription that formed part of the proposed transaction, which has had to be cancelled.”